How eFencing Works

Now that organized retail crime groups are using the Internet as tool for eFencing, they're finding they can make more money easier on auction sites like eBay than at pawn shops like this one in Los Angeles, Calif.

If you think that eFencing involves an underground, online community of gamers who take part in online fencing, or fighting digitally with swords, unfortunately that's not the case. In the world of criminal investigation, a "fence," according to Merriam-Webster OnLine, is both "a receiver of stolen goods" and "a place where stolen goods are bought."

The word "fence," despite its various meanings and whether it's a noun or a verb, has one main root -- the shortening of "defense." The fences people build around their homes provide a defense from outside intruders and allow enclosure. In relation to stolen goods and organized crime, however, fence first popped up in thieves' slang around 1700, with the understanding that such dealings take place "under defense of secrecy" [source: Online Etymology Dictionary].

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So a fence's job is fairly straightforward: Steal or buy a popular item for a significantly reduced price and then sell the item in order to make money. In the physical world, much of this activity goes on at pawn shops and flea markets. A fence can steal something from a store and bring it into a pawn shop and, if he remains above suspicion, walk out with a handful of cash and a big profit.

The act of eFencing is the same exact offense, only it's done over the Internet, typically on online auction sites or classifieds like eBay and Craigslist. A thief steals something from a store, posts the item on the Internet and sells it to unsuspecting bidders, making money in the process.

Although fences aren't anything new in the world of retail, the nature of the Internet has increased the act of fencing and made fraudulent transactions much easier. How have online sites increased dealing in stolen goods?